Bitmine Chairman Tom Lee believes that increasing oil prices are the primary cause of Ethereum’s recent difficulties. He notes that there’s a strong negative relationship between oil prices and Ethereum, and this connection is currently stronger than it’s ever been.
He made this observation as Ethereum (ETH) trades around $2,100, which is about 3% lower for the day and 12% lower over the last month.
The Oil Connection
As a researcher, I’ve been following the relationship between oil prices and Ethereum (ETH), and recently I noticed a strong connection. In a post on May 18th, I shared my observations: over the past six weeks, as oil prices have increased, ETH’s value has tended to decrease. I believe rising oil prices are currently the biggest challenge for ETH, and the inverse correlation between the two is stronger than I’ve ever seen. Essentially, if oil prices start to fall, I anticipate ETH will likely rebound.
Lee was careful to present these issues as temporary setbacks, not fundamental flaws. He believes the future still depends on two key developments: turning real-world assets into digital tokens and creating AI that can act independently.
He believes the underlying factors are now established, and as a result, he anticipates the price of ETH will increase throughout 2026.
The fact that he made these comments now is significant. Ether (ETH) has been steadily decreasing in value for weeks, and this decline sped up on May 18th after increased global tensions. US President Donald Trump posted a warning to Iran on Truth Social, saying their “clock is ticking,”, which contributed to the market pressure.
Bitcoin‘s price dropped to around $76,700, a level it hasn’t seen since early May. This triggered a large wave of liquidations, wiping out over $660 million in leveraged positions. Ethereum accounted for a significant portion of these losses, totaling $256 million, according to CoinGlass data.
As a researcher tracking the recent market activity, I observed a particularly strong sell-off on both Binance and OKX. Analyst Amr Taha’s data showed that on Binance, the volume of sell orders executed by ‘takers’ exceeded $1.1 billion as the price of Ethereum approached $2,100.
A Market Cleared of Longs
Liquidation data indicates that much of the risky buying in the market has been eliminated. According to CW, a market analyst, there’s only around $600 million left in highly leveraged bets that Ethereum’s price will go up. In contrast, bets that the price will fall total $6.3 billion – over ten times more than the bullish positions.
From my analysis, a new CME gap has opened up around the $2,200 level. What’s interesting is that now there are three unfilled CME gaps positioned between the current price and $3,200. This actually reduces some of the immediate downside technical risk we were seeing.
Crypto trader Crypto Ed noted that both Bitcoin and Ethereum have reached support levels, which he calls “green boxes.” However, he anticipates prices may fall further before a lasting increase. Over the weekend, Ethereum reached a 10-month low compared to Bitcoin, with the value of one Ethereum falling below 0.028 Bitcoin – a level not seen since mid-last year.
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2026-05-19 00:54